Why You Should Invest in Real Estate This Year
- Zikan Realtors
- Oct 26
- 3 min read
Investing in real estate in Nigeria right now offers more than just shelter — you can build long-term wealth, generate steady passive income, and protect your savings against inflation and volatility. In this post, we lay out Why You Should Invest in Real Estate This Year, exploring key drivers, benefits, risks, and steps to help you make smart moves in 2025.
1. Strong Demand & Housing Shortage
Nigeria is experiencing rapid urbanisation and population growth. Major cities such as Lagos, Abuja, Port Harcourt and Ibadan are seeing continual inward migration, which is putting pressure on existing housing stock. The housing deficit is enormous: estimates suggest a shortfall of over 28 million housing units. (africahousingnews.com)
When demand outstrips supply so heavily, rental occupancy tends to remain high and property values appreciate—both essential if you're seeking returns or passive income.
2. Property Value Appreciation Over Time
Despite macroeconomic challenges, the Nigerian real estate sector has shown resilience. In Q3 2024, the real estate sector recorded a growth of about 5.3% according to the National Bureau of Statistics (NBS).
Prime areas like Lekki, Ikoyi, and Victoria Island have seen price increases of roughly 15% in 2024. (Vanguard News)
These trends suggest that for those who invest smartly (location, title, infrastructure), property prices are likely to continue rising. That’s a major reason for Why You Should Invest in Real Estate This Year.
3. Attractive Rental Income & Passive Cash Flow
With the housing shortage and growing middle class, demand for rentals (both long-term and short-let) remains robust. Rental yields in high-demand areas (Lekki, Yaba, Ikeja GRA) are estimated between 6-12% annually. (africahousingnews.com)
Also, with remote work, short lets and serviced apartments are getting more traction, creating opportunities for higher returns in certain zones. For investors looking to generate passive income, this is especially promising.
4. Inflation Hedge & Wealth Preservation
Nigeria experiences high inflation rates which erode value of cash savings. Real estate is one of the few assets that tends to hold value (and appreciate) in inflationary contexts. It offers a physical, tangible asset that typically increases in value when general prices rise.
Additionally, rental income often adjusts or increases over time, helping to preserve purchasing power. This makes real estate a potent tool in preserving and growing wealth.
5. Government Incentives & Policy Improvements
The government has been introducing policies to support real estate investment:
Reduced documentation costs and efforts to streamline registration in states like Lagos and Ogun.
Tax incentives for developers, especially those in affordable housing and larger volume projects.
Programs like the National Housing Fund, which provide more accessible financing for homebuyers.
Improving regulatory clarity and incentives mean lower barriers to entry and better margin potential.
Risks to Be Aware Of
To decide Why You Should Invest in8ń Real Estate This Year, you must also understand what could go wrong. Here are the main risk areas:
Title & Ownership Disputes: Omonile claims, overlapping customary vs statutory land claims, fake titles — these remain serious threats.
Infrastructure & Utilities: Even if location is good, lack of roads, inconsistent power or water supply can negatively impact occupancy, maintenance costs, or desirability.
Economic Volatility: Inflation, devaluation of the naira, rising cost of building materials all affect both development costs and returns.
Regulatory / Bureaucracy Delay: Obtaining approvals, land registration, building permits can be slow, unpredictable, and vary by state.
How to Maximise Your Chances of Success
If you decide to invest this year, here are strategic steps to tilt odds in your favour:
Choose locations with infrastructure momentum (roads, new transit lines, utilities).
Thorough legal due diligence: title searches, survey plans, local community issues, development permits.
Use realistic financial models that account for unexpected delays, inflation in materials, maintenance, vacancy.
Diversify: combine land, residential, commercial or short-let properties to spread risk.
Engage local expertise: surveyors, lawyers, developers with proven track records.
Real estate offers compelling opportunities right now in Nigeria. The structural forces — housing shortage, rising prices, government incentives, inflation protection — all support the case for action. When done well, real estate can deliver both long-term capital gains and steady passive income.
If you’re ready to make informed investments, assess potential deals, or want help structuring property purchases for maximum return, reach out to Zikan Prop Solutions. Let's map out your investment plan in Nigeria so you can profit this year and beyond.
🏢 Zikan Prop Solutions
🥇 Certified Real Estate Consultant | Multi Award-Winning Realtor
Helping you make the best real estate purchase & investment decisions.
📱 +234 703 000 3514
📲 IG: @zikanpropsolutions
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